Report on Specialization in the Canadian Chartered Accountancy Profession – December 1981

The 148-page Report of the Committee to Study Specialization in the Canadian Chartered Accountancy Profession was issued in December 1981. The Chairman’s Letter by W.D. Grace, FCA, states that: “The issue of specialization within the profession is not easily resolved. The Committee believes that the recommendations for a voluntary structured plan of specialization would prove to be of significant long term benefit to the Canadian public and to all members of the chartered accountancy profession. The Committee has addressed the issue of specialization through a lengthy process of research, discussion, and debate and by consideration of the present de facto situation and the specialty experiences of other accounting bodies and other professions.” The Committee recommended that four specific areas of practice be initially recognized as specialties: taxation, insolvency, business valuation and computer audit.

According to the booklet called Another Great Leap - CA•Designated Specialists, Chartered Accountants in Canada now have access to six profession-endorsed specialist designations, some offered directly by the Canadian Institute of Chartered Accountants (CICA) and others through organizations that have been accredited by the CICA. Currently, more than 1,000 have earned the advantage of a CA specialist designation. Regardless of the route to the specialist designation, candidates for specialist certification need to demonstrate experience in the field, in addition to completing an evaluation process. As well, specialists must comply with continuing experience and professional development standards to maintain the designation.

For more information, read the CAmagazine article, “Breaking new ground” (published in December 1997, page 2). This article discusses the first specialist designation for investigative and forensic accounting. Also, refer to the CICA website section on CA Specialization and the Institute of Chartered Accountants of Alberta (ICAA) website section on Specialty Designations.

Indiana CPAs - In the beginning …

Before there was a tax code (1913), before there was a Department of Labor (1913), before the SEC (1935) and before the PCAOB (2002), even before audits, there were CPAs (New York – 1896). How did the profession rise to the level of prominence in business without license to do something specific?

What were the requirements in 1915? Well … you had to be 21 years old, a high school graduate, have three years of experience as a professional accountant and submit “proof” of all of that to the newly created “state board of certified accountants”. Then, per Indiana law, “shall be granted without examination a certificate authorizing him to practice as a certified public accountant”. Of course this had to be done within 90 days. After that you would have had to take an examination. The early CPAs were grandfathered. That is how the profession got its start.

The first accounting standards were issued somewhere around 1938, and by 1959 there were 51 pronouncements known as Accounting Research Bulletins – this eventually became GAAP. The pronouncements were issued by the Committee on Accounting Procedure (CAP). The first auditing standards were issued in 1939 by the American Institute of Accountants committee on auditing procedure. In 1941, the SEC mandated that the auditor’s report had to be made in accordance with GAAP (they didn’t do that in 1935 because there was no GAAP).

To learn more, read the article “In the beginning …” posted on the Indiana CPA Society blog on February 16, 2012 by Gary Bolinger.

History of Income Tax in the United States

The story of how the United States wound up with the income tax is the story of two wars, a Supreme Court justice on his death bed, and Donald Duck. It’s also the story of how the government overcame three obstacles. Obstacle No. 1 was Logistics — How do you make sure people pay? Obstacle No. 2 was The Constitution — In the 19th century, the income tax fell almost exclusively on the rich who, as it turns out, had some pretty good lawyers.

Obstacle No. 3 was The Love — Until World War II, the income tax was levied only on the rich. But wartime spending meant the government needed money, and ordinary folks are now asked to pay. The government needed Donald Duck. In a movie from 1943, Donald Duck marches around his house, listening to the radio and filling out his tax form. Occupation: actor. Dependents: three (Huey, Dewey and Louie). This wartime patriotic motivation campaign worked. Maybe we didn't love the income tax. But we paid it. [Copyright 2012 National Public Radio]

To learn more, read the NPR news story called “FromAbe Lincoln To Donald Duck: History Of The Income Tax” dated March 22, 2012.

Canadian income tax, then and now

It has been almost 40 years since Canada overhauled its tax system, eliminating estate duties and bringing in capital gains tax. Since 1972, we have seen no less than 49 editions of the Income Tax Act. Its length has increased enormously and the complexity exponentially. Changes in technology have aided the Canada Revenue Agency in the selection and audit of taxpayers. Ever-changing legislation, powerful audit tools, information exchange agreements and anti-avoidance rules have made tax planning harder, tax compliance more challenging and tax enforcement easier with key changes over the past 40 years and challenges presented to the accounting profession. (Read the article “Income tax, then and now” in the June-July 2011 issue of CAmagazine online.)

Welcome to the AAA Digital Library!

The mission of the American Accounting Association (AAA) is to promote worldwide excellence in accounting education, research and practice. Founded in 1916 as the American Association of University Instructors in Accounting, its present name was adopted in 1936. The Association is a voluntary organization of persons interested in accounting education and research. The AAA Digital Library includes the following publications: The Accounting Review; Issues in Accounting Education; Accounting Horizons; Accounting and the Public Interest; The ATA Journal of Legal Tax Research; AUDITING: A Journal of Practice & Theory; Behavioral Research in Accounting; Current Issues in Auditing; Journal of Emerging Technologies in Accounting; Journal of Information Systems; Journal of International Accounting Research; Journal of Management Accounting Research; and Journal of the American Taxation Association. All full-text papers are provided in PDF format and are searchable using the Find utility in Adobe Acrobat Reader. All full-text papers provide links to references, as available. The AAA Newsletter, Accounting Education News, as well as the AAA Section Newsletters are also available online, some dating back to 1995.

Tax blast from the past

The total tax bill of the average Canadian family has increased by 1,624% since 1961 — a faster increase than any other single household expenditure — according to a study by the Fraser Institute. In contrast, expenditures on housing increased by 1,198%, food by 559% and clothing by 526% from 1961 to 2009. (See "Tax blast from the past" in CAmagazine online.

Canada's tax system - 2020 Vision

What will Canada’s tax system look like 10 years from now? Tax reformists hope to see one that encourages work and fosters productivity and competitiveness. There is no better time than December to look at the year and the decade ahead. CAmagazine asked a range of experts what they think Canada's tax system will look like 10 years from now. To find out what they had to say, see the article "2020 Vision" in the December 2010 CAmagazine online.

About the Internet Archive and Canadian Libraries

The Internet Archive is a non-profit organization that is building a digital library of Internet sites and other cultural artifacts in digital form. Like a paper library, it provides free access for researchers, historians, scholars, people with disabilities, and the general public to historical collections that exist in digital format. Founded in 1996 and located in San Francisco, the Internet Archive has a historical web collection (the Wayback Machine) of over 150 billion web pages, about 240,000 movies, more than 500,000 audio items (including over 70,000 live concerts), 1,800,000 texts, and 30,000 software items. A blog called What’s New at the Internet Archive is also being maintained. An example of a historical document available at the Internet Archive is the Canadian Income Tax Act, 1917 which can be read online or downloaded as a PDF. (Learn more about Canadian Libraries and Internet Archive Canada online.)